Bulatlat - The Philippines's alternative weekly magazine

Bu-lat-lat (boo-lat-lat) verb: to search, probe, investigate, inquire; to unearth facts

Vol. VI, No. 36 Oct. 15 - 21, 2006 Quezon City, Philippines

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Dirt Cheap

October is harvest time in the Philippines but farmers have nothing to be happy about. The farm gate price of locally produced palay (rice grains) remains dirt cheap and that their earnings are only enough to pay their debts. They would even have to borrow milled rice for their family’s consumption to tide them over until the next cropping season.

BY DABET CASTAÑEDA
Bulatlat

ARAYAT, Pampanga (84 kms. north of Manila) – Palay (rice grains) stalks in Barangay (village) Baliti, this town, are starting to bend over, an indication that they are ready for harvest.

Although the grains sparkle like gold in his two-and-a-half hectare farm, Hermando Tinio, 48, is not quite optimistic about his harvest next week. “Pambayad-utang lang yan” (Just enough to pay my debts), he said while he strolled along the small dikes in his rice fields.

DEBT PAYMENT: The money this man will earn from the rice he is harvesting will go only to the debts that he had to incur.
Photo by Dabet Castañeda

Loan

For this cropping season, Tinio borrowed money to finance all his needs for the farm from the palay trader. His loan amounted to P45,755 ($915.10 at an exchange rate of $1=P50) and he is expected to pay a seven percent interest per month after harvest. Below is the breakdown of his loan:

araro (plow rental)	P 7,500.00
binhi (seeds)	P 3,000.00
patanim (farm workers' fee for planting)	P 6,075.00
bunot punla (farm workers' fee for uprooting seedlings)	P 3,000.00
fertilizer	P 9,960.00
gamot sa damo (pesticide)	P 1,500.00
gamot sa trigo (pesticide)	P 2,720.00
insecticide	P 2,000.00
pakain sa tabasan (food for farm workers)	P 5,000.00
diesel (for irrigation)	P 3,000.00
sako (sacks)	P 2,000.00
TOTAL	P 45,755.00

As per Tinio’s computation, he would have to pay P3,202.85 ($64) per month or P12,811.40 ($256.22) for four months in interest alone.

The same trader, Tinio said, would buy his crops at P8.60 ($0.172) per kilo or P450 ($9) per cavan on the average. This is the prevailing farm gate price in their area, according to Tinio.

Tinio said the lowest farm gate price is pegged at P8.50 ($0.17) per kilo when harvest is at its peak. Meanwhile, it would cost around P9.50 ($0.19) per kilo when it is dry and around P10-P11 ($0.20-$0.22) per kilo when it is ready to mill.

But Tinio said the price range of palay is still low considering the high prices of farm inputs and rates of loan interests.

The Kilusang Magbubukid ng Pilipinas (KMP or the Peasant Movement in the Philippines) with membership of up to 100,000 nationwide is demanding that government regulates a farm gate price of P12 to P15 ($0.24-$0.30) per kilo to help augment the earnings of poor farmers.

National Food Authority (NFA) Director for Public Affairs Rex Estoperez said the regular buying price of the NFA is pegged at only P10 ($0.20) per kilo of palay. Although it is more than a peso higher than the buying price of traders, Tinio said the farmers in their village still prefer selling to traders.

First, he said, the NFA only wants to buy ready-to-mill rice grains. But Tinio argues that for a country prone to rain and typhoons, rice grains are expected to be wet when harvested. It would take a few more days for farmers to let the grains dry on the streets because they do not have mechanized dryers.

The woman just picked these grains that fell to the ground from the thresher. Photo by Dabet Castañeda

Second, Tinio said they would have to deliver the grains to the provincial NFA office if they want to sell to the government agency thereby adding to their costs. “Yung traders kinukuha mismo dito sa bahay namin yung palay” (Traders get the palay direct from our homes.), he said.

And thirdly, Tinio said, he had to sell to the trader. “Kasi yung palay ang pambayad sa utang ko sa trader” (I have to pay for my loan from the trader with the palay I harvested.), he said.

No support

Although rice is the staple food of Filipinos, the government lends no support to rice producers, KMP secretary general Danilo Ramos said in an interview with Bulatlat.

Data from the Bureau of Agricultural Statistics (BAS) show that out of 3.2 million palay farms in the country, only 800 hectares are irrigated either by the National Irrigation Authority (NIA), or communal or private irrigation systems. The remaining rice fields are rain-fed.

Ramos said farmers are supposed to benefit from projects implemented by the Department of Agriculture (DA) and the regulation of farm gate prices by the NFA. But sadly, he said, farmers are left to fend for themselves.

Although the country consumes 3,800 metric tons of rice per day nationwide (based on a 192 kl/capita consumption), Estoperez admits that the NFA buys only from one to five percent of the total harvests of locally produced palay. The rest of the country’s consumption of rice is sourced from imports.

Estoperez said the country imported 1.6 metric tons this year alone. This, he said, makes the Philippines the fourth biggest rice importing country in the world next only to Iraq, Iran and Indonesia, which has low rice production.

Nothing left

Tinio said practically there would be nothing left for him and his family this season. While he is expecting to harvest around 200 cavans from his 2.5-ha. lot, he will be paying 26 cavans to the farm workers who would help him harvest the palay; five cavans will go to the thresher-owner; six cavans will go to the farm workers who would carry the sacks of rice from the farm to Tinio’s house; and 10 cavans to the landowner.

If Tinio will be left with 131 cavans and sells it at P450 ($9) per cavan to his trader, he will earn P59,950 ($1,199).

However, Tinio will still have to pay his trader a total of P58,566.40 ($1,171.32), P45,755 ($915.10) for the farm inputs and the P12,811.40 ($256.22) interest. Tinio would be left with a pittance, P383.60 ($7.67) in earnings for the four-month cropping season.

“Kita ko na sana yung binayad ko sa porsyento sa utang” (The loan interest could have been added to my earnings.), he said shaking his head.

Tinio said he intends to keep at least five cavans of his palay harvest for his family to consume for roughly two months. After which, he said, he would be going back to the trader to borrow a few sacks of milled rice for their food. Bulatlat

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